Tech View: Nifty setup bearish, signals possible consolidation
A bearish candle on Thursday’s daily charts made the case stronger for rangebound trade ahead.
A bearish candle on Thursday’s daily charts made the case stronger for rangebound trade going ahead.
At close, the index was up 1.55 points, or 0.01 per cent, at 11,343. What made it a strong bearish case was the fact that the opening level of 11,382 for the index proved to be day’s high.
“Our twin momentum oscillators, which usually have higher accuracy in catching short-term turning points, are in sell mode. We advise traders to refrain from maintaining or creating fresh long positions at this juncture,” said Mazhar Mohammad of Chartviewindia.in.
Thursday’s price action signalled rangebound action in the market at highs, said Nagaraj Shetti of HDFC Securities.
Shetti said there is no convincing indication of a downward reversal, but the index might face resistance around the 11,450 mark.
Daily strength indicator 14-day RSI continued to be in the overbought zone. Momentum oscillator Stochastic remains flat, indicating a possible consolidation in the near term, said Rajesh Palviya, Head Technical & Derivatives Analyst, Axis Securities.
He noted that the index continued to form higher highs for the day. Besides, it held above crucial moving averages, which limits any major downside.
Chandan Taparia of Motilal Oswal Securities sees downside supports at 11,280 and 11,222. Nifty must hold on to the 11,280 level for any possible upside, he said.
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